(Recasts with new CEO, market reaction and background)
By Marcin Goclowski
WARSAW, June 14 Poland's second-largest lender
Bank Pekao SA said on Wednesday it nominated former
insurance boss Michal Krupinski as the bank's chief executive
officer after long-serving CEO Luigi Lovaglio was dismissed
earlier in the day.
The management change, which also included the resignation
of the bank's two deputy CEOs, follows the purchase of a 32.8
percent stake in Pekao by state-run entities.
Insurer PZU and state investment vehicle PFR finalised the
purchase of the stake last week from Italy's UniCredit
Pekao said in a statement it had appointed Krupinski as
deputy CEO pending approval by the Polish Financial Supervisory
Authority (KNF), at which point he will be made CEO.
Krupinski was CEO of PZU at the time when the state-run
insurer decided to buy the Pekao stake for 10.6 billion zloty
Lovaglio, 61, who holds both Italian and Polish passports,
was appointed to Pekao's board in 2003. He had a reputation as a
respected manager who presided over solid financial results. He
also resisted temptation to grant Poles the Swiss
franc-denominated mortgages that became a serious problem for
the banking sector.
"Political factors and dividing the spoils have became more
important than business. This is inconsistent with pledges that
he will lead the bank during the transition period and this is
why the share price is down," one analyst in Warsaw said of
By 1430 GMT Pekao shares had recovered to be up 0.5 percent,
outperforming the main index of the Warsaw bourse which
was down 0.2 percent.
Separately, the supervisory board at Poland's biggest
lender, state-run PKO BP decided on Wednesday to keep
long-serving CEO Zbigniew Jagiello in place for another term.
($1 = 3.7266 zlotys)
(Additional reporting by Lidia Kelly and Marcin Goettig;
Editing by Elaine Hardcastle)